Power Companies Likely Will Not Bill Customers For Isabel Costs

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RALEIGH, N.C. — Residents who went without electricity and phone service after Hurricane Isabel hit North Carolina probably
will not have to pay for repairing the utilities' infrastructure.

Most publicly traded electric utilities and telephone companies
said they don't plan to pass on repair costs from storm damage to
customers. Instead, company shareholders will likely bear the
costs.

The list includes Charlotte-based Duke Power, Richmond,
Va.-based Dominion Resources _ which has 115,000 customers in North
Carolina _ BellSouth and Sprint.

Raleigh-based Progress Energy said it hasn't made a decision on
recouping repair costs from Isabel, which came ashore Thursday
afternoon.

Duke Power still doesn't know how much it will cost to fix
downed lines that left about 131,000 customers in the Triangle and
the Triad without power for two days after the storm, spokesman Tom
Williams said.

But the total will be much lower than the $87 million it cost to
make repairs after the ice storm in December 2002 that left 1.4
million customers without power for as long as nine days, he said.

The last time Charlotte-based Duke passed storm repair costs on
to customers was after Hurricane Hugo in 1989, which caused $65
million in damage.

"We will not seek increases to recover (Isabel) storm costs,"
Williams said. "This is part of our normal operating expense."

Progress Energy had 320,000 customers without power at the peak
of last week's storm. Company spokesman Garrick Francis said it
took $39 million to restore power to 460,000 customers in December.

Progress did not seek a rate increase for those costs.

"We've been focused on restoration and haven't figured out all
the costs associated with Hurricane Isabel," Francis said. "Any
discussion of cost or their allocation will be done at a later
day."

Electric utility rates are frozen in North Carolina until 2007,
but companies can ask the state Utilities Commission for increases
to recover costs for unusual events.

Sprint isn't finished with repairs for Isabel damage, but
doesn't plan to ask for a rate increase to cover the costs, company
spokesman Tom Matthews said.

At the peak, the company had about 80,000 customers without
phone service. On Monday, that total was down to 7,000, mainly in
the northeastern part of the state.

He said the company shouldered about $30 million in repair costs
from Hurricane Floyd in 1999, which knocked out service to about
150,000 customers.

"This is the cost of doing business," Matthews said.

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